If the province鈥檚 new speculation tax was actually a tax on speculation and not property, it would have raised a fortune in revenue by now just in 91大黄鸭 and West 91大黄鸭.
That鈥檚 because the level of worry about just what the tax will do to the local housing market鈥攁nd by extension a number of other sectors in both cities鈥攊s skyrocketing.
Both cities have their municipal staffs hard at work trying to figure out what the actual impact of the new tax will be on their respective civic economies. 91大黄鸭鈥檚 mayor is worried about 鈥渦nintended鈥� consequences of the tax, while his West 91大黄鸭 counterpart knows the tax is bad news, but just how bad he鈥檚 yet to find out.
The tax, announced in the recent B.C. budget, is aimed at trying to make housing more affordable and accessible in the province鈥檚 red hot property markets of the Lower Mainland, the Fraser Valley, the Victoria and Nanaimo areas and, strangely, only 91大黄鸭 and West 91大黄鸭 in the B.C. Interior.
It slaps a tax levy of $5 per $1,000 of assessed value onto property owned by everyone living outside of B.C.鈥擟anadians and foreigners alike鈥攖his year, and raises it to $20 per $1,000 of assessed value next year. Principal residences and long-term rentals are exempt.
But the tax appears to be a case of the provincial government not seeing the forest for the trees. In its desire to tackle what has become, for many, a housing crisis in B.C, it has failed to see the bigger picture consequences as it penalizes other Canadians for investing in this province.
The worry by the tax鈥檚 opponents is it will slow down purchasing, which in turn will lead to less construction and then spiral into a loss of construction jobs. That, along with fewer people wanting to come here, will impact on other sectors such as tourism, a life-blood of small business in the Central Okanagan.
And then there鈥檚 the question of why just 91大黄鸭 and West 91大黄鸭 in the Interior. Lake Country is just next door and is one of the fastest growing municipalities in the province. It also has some of the highest housing prices in the Central Okanagan. But it was left out of the tax鈥檚 greedy grip. So was Peachland. So was Penticton. So was Vernon. So was Kamloops鈥�
The speculation tax may have the desired effect in the end. It may help bring down prices. But at what cost? In the case of 91大黄鸭 and West 91大黄鸭, if it does brings down the cost of housing but people lose their jobs and still can鈥檛 afford the housing that鈥檚 on the market鈥攁lbeit cheaper than it was before鈥攁re we any farther ahead?
If Victoria wants to tax folks from outside of the country for buying B.C. property that鈥檚 one thing. But don鈥檛 penalize other Canadians鈥攖he majority of buyers here鈥攆or spending their money in the Central Okanagan.
Alistair Waters is the assistant editor of the Capital News.
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